Dutch Court Rules On Shell Nigeria Oil Spill Case

 

A Dutch court will hand down its verdict on Friday in a long-running case pitting oil giant Shell against four Nigerian farmers who accuse it of causing widespread pollution.

After 13 years of legal wrangling, an appeals court in The Hague will rule on the farmers’ demands for the Anglo-Dutch firm to clean up devastating oil spills in three villages in the Niger Delta and pay compensation.

The case, backed by the Netherlands arm of environment group Friends of the Earth, is the first time a Dutch company has been held liable for actions by its foreign subsidiary.

The case has dragged on so long that two of the Nigerian farmers have died since it was first filed in 2008, as Shell argued that the matter should not be heard in the Netherlands.

The ruling is expected at 1000 GMT.

“After almost 13 years, we will hear whether Nigerians will finally receive justice or whether Shell has succeeded in completely shirking its responsibility for the pollution,” Donald Pols of Friends of the Earth Netherlands said in a statement.

“For the inhabitants of the Niger Delta it is crucial that their land is cleaned up and their lost crops and livelihoods are compensated by the guilty party: Shell,” he added.

Shell has always blamed the spills on sabotage and said it has cleaned up with due care where pollution has occurred.

‘New era’

The farmers first sued Shell in 2008 over pollution in their villages Goi, Ikot Ada Udo and Oruma, in southeastern Nigeria.

A lower court in the Netherlands found in 2013 that Shell should pay compensation for one leak, at Ikot Ada Udo, but ruled that Shell’s parent company in the Netherlands could not be held liable in a Dutch court for the actions of its Nigerian subsidiary.

But in 2015 the Hague appeals court ruled that Dutch courts did indeed have jurisdiction in the case.

The appeals court will on Friday decide on the substance of the case: whether Shell is to blame for the oil leaks and did it do enough to prevent them and future spills.

“A victory would herald the beginning of a new era in which large multinationals such as Shell can no longer go about their business lawlessly but are accountable for their entire operations, including overseas,” said Pols.

At a hearing last year lawyers for the farmers showed gushing and burning oil spills as well as villagers dragging their hands through water sources, their hands streaked with the substance afterwards.

Nigeria was the world’s ninth-largest oil producer in 2018, pumping out volumes valued at some $43.6 billion (37 billion euros), or 3.8 percent of total global production.

In a separate case in the Netherlands, the widows of four Nigerian activists executed by the military regime in the 1990s have accused Shell of complicity in their deaths.

Shell also faces a landmark legal bid to force it to meet emissions targets in the Paris climate accords, brought by several environmental groups in the Netherlands led by Friends of the Earth in 2019.

Shell Dives To $18.1bn Q2 Loss On Coronavirus-Hit Oil Market

 

 

 

Anglo-Dutch energy major Royal Dutch Shell posted Thursday a colossal net loss of $18.1 billion (15.4 billion euros) for the second quarter, blaming massive asset writedowns on the coronavirus-hit oil market.

The performance, contrasting sharply with profit after tax of $3.0 billion a year earlier, was sparked by a huge $16.8-billion charge on chronic fallout both from COVID-19 and collapsing oil prices.

The vast charge was taken “as a result of revised medium- and long-term price and refining margin outlook assumptions in response to the COVID-19 pandemic and macroeconomic conditions as well as energy market demand and supply fundamentals,” Shell said in a results statement.

The quarterly performance meanwhile reflected lower prices for oil, liquefied natural gas (LNG) and gas, while it was also adversely impacted by lower refining margins and oil products sales volumes.

Production dipped six percent to 3.4 million barrels of oil equivalent per day in the reporting period — and is forecast to drop further in the third quarter.

“Shell has delivered resilient cash flow in a remarkably challenging environment,” said Chief Executive Ben van Beurden in Thursday’s statement.

“We continue to focus on safe and reliable operations and our decisive cash preservation measures will underpin the strengthening of our balance sheet.”

The energy giant had already forecast in June that it would face a charge of between $15 billion and $22 billion in the second quarter, after crude futures had suffered a spectacular crash on COVID-19 fallout, the Saudi-Russia price war and oversupply.

Both Shell and British rival BP, which reports its earnings next week, have opted to book charges in the second quarter on sustained coronavirus fallout that ravaged the world’s appetite for crude oil.

Shell had already plunged into the red in the first quarter of this year on the back of the oil price crash, which prompted it to cut its shareholder dividend for the first time since the 1940s.

The deadly COVID-19 outbreak slammed the brakes on the global economy and savaged oil-intensive industries.

The outbreak also sent oil prices off a cliff from March onwards — and even caused them briefly to turn negative in April.

Prices have since rebounded sharply on an easing global crude supply glut and as governments relax lockdowns and businesses slowly reopen.

Crude futures currently stand at about $40 per barrel, which is still well down on the same stage last year.

 

 

 

-AFP

President Buhari Receives Delegation Of Royal Dutch Shell In London

President Muhammadu Buhari on Wednesday received a delegation of Royal Dutch Shell in the London, United Kingdom.

President Buhari received the Chief Executive Officer (CEO) Royal Dutch Shell, Ben Van Beurden, alongside MD Shell Petroleum Development Company of Nigeria, Mr Osagie Okunbor and VP Nigeria and Gabon Shell Mr Peter Costello.

The President is in London for the Commonwealth Heads of Government Meetings.

He earlier this week held bilateral talks with the British Prime Minister Theresa May.

See Photos below…

Nigerian Oil Spill: Court Rules Villagers Cannot Sue Shell In London

ACrude-oil-spill High Court sitting in the United Kingdom has ruled that oil major Royal Dutch Shell cannot be sued in London courts over allegations of oil spill in Nigeria.

Bille and Ogale communities in the oil-rich Niger Delta region had filed a case alleging oil spill against the company’s subsidiary, Shell Petroleum Development Company of Nigeria (SPDC) in the British court.

But the court on Thursday ruled that the suit did not establish that Shell, the parent company, had legal responsibility for SPDC’s actions and that the claimants failed to demonstrate the first threshold requirement – that is a ‘real issue’ between the claimant and the anchor defendants – is met.

Observers say that if the High Court had ruled in favour of the two communities, other claimants against British-based multinationals could have been emboldened to pursue legal action through the British courts.

Shell also denies responsibility for the spills, which it says were due to sabotage and illegal refining.

In the meantime, Leigh Day, a law firm representing the villagers, said it would appeal the ruling.

The SPDC’s General Manager for external relations, Igo Weli, said the firm hoped “the strong message sent by the English court on Thursday will ensure that any future claims by Nigerian communities concerning operations conducted in Nigeria will be heard in the proper local courts”.

 

Oil Spill: Nigerian Communities Tackle Shell In London Court

Oil Spill: Nigerian Communities Battle Shell In London CourtA High Court in London will determine whether Royal Dutch Shell can face trial in the United Kingdom over allegations of oil spill in Nigeria.

Reuters said the court would decide in a matter of weeks whether members of Bille and Ogale communities in Rivers State can sue shell in British courts.

This follows the claim by the law firm representing the communities that Nigerian courts are not strong enough to handle the matter in a reasonable time.

The Anglo-Dutch company, however, insisted that the case should be heard in Nigeria as the matter was the country’s problem.

Shell denied responsibility for the oil spills, but attributed it to sabotage and illegal refining by some people in the two oil-rich communities.

The case was said to have been filed shortly after the company admitted responsibility for two pipeline leaks in 2008, and agreed to pay the sum of 55 million pounds to Bodo community, also in Rivers State.

Shell Resumes Oil Exports From Forcados Terminal

ShellRoyal Dutch Shell has resumed crude oil exports from the forcados terminal. This follows the restoration of the damaged facilities by Niger-Delta militants in the south-south region of the country.

The development was communicated to the presidency by the Director of Global Upstream of Shell, Andrew Brown.

Forcados crude has been under force majeure from operator, Shell, since a militant attack on the sub-sea pipeline in February.

Exports from the terminal was between 250,000 and 300, 000 barrels per day before the strike claimed by militant group, Niger Delta Avengers.

Meanwhile, the militant group at about 4am on Wednesday reportedly blew up a Chevron offshore export pipeline at Escravos in Delta State.

Militants Attack Italy’s Eni, Agip Pipeline

Militants, pipeline,Niger Delta Avengers, NembeBarely a day after the militant group in southern Nigeria, the Niger Delta Avengers threatened what it termed “something big”, reports say a major pipeline operated by Italy’s Eni, Agip has been attacked in Bayelsa State.

This follows the attacks on Chevron’s Estravos pipeline, and another on the Nigerian National Petroleum Corporation pipelines, earlier this week.

The Nembe pipeline is said to carry the bonny light crude exported by Royal Dutch Shell, though the company is yet to make any official statement on the incident.

The Niger Delta Avengers, a new group of militants in the Niger Delta, had announced on Twitter earlier on Saturday that it had hit the Nembe pipeline.

Local sources told Channels Television that the attack took place at about 2:00a.m. local time on Saturday.

The militants had posted a warning on Twitter that reads: “Watch out something big is about to happen and it will shock the whole world”.

 

Shell declared force majeure on Bonny Light loadings after a previous attack on the Nembe creek trunk pipeline, but some exports have continued with delays caused by repair work.

Nigeria Faces Likely Oil Output Drop As Exxon Suspends Exports

Gas-flaring_Niger-delta_NigeriaU.S. oil major, Exxon Mobil Corp, says it has suspended exports from Nigeria’s top crude stream.

The suspension has added to economic strains from renewed activities of militants in the Niger Delta region that have cut production to its lowest in decades.

Reuters quoted Exxon Mobil as saying on Friday that it had declared a force majeure – a suspension of deliveries because of events beyond its control – on Nigeria’s Qua Iboe crude oil grade BFO-QUA, and that a portion of production had been curtailed after a drilling rig damaged a pipeline.

Last week, Chevron’s platform in the Delta was attacked by militants.

The outages adds to production problems at two of the other largest crude streams, Bonny Light and Forcados, which have already taken Nigeria’s output to a 22-year low.

Royal Dutch Shell shut a major pipeline earlier this week and declared force majeure on Bonny Light crude exports on Wednesday, while an attack in February on a pipeline also caused it to shut the 250,000 barrels per day Forcados export terminal.

Nigeria’s oil production has fallen to 1.65 million barrels per day (bpd) due to militant attacks, Finance Minister Kemi Adeosun, said on Friday, from 2.2 million bpd.

According to Reuters calculations, if outages at Qua Iboe and other streams are prolonged, Nigerian output could fall to around 1.2 million bpd.

This would be the lowest output since 1970, according to BP’s statistical review.

Nigeria had been Africa’s largest crude exporter with its economy heavily reliant on oil up until this year, when rampant oil theft and corruption has kept production well below capacity.

As a result, Angola has overtaken Nigeria as the continent’s largest producer since March, according to OPEC figures.

Nigerian Government Recieves $42bn From Shell In Five Years

ShellShell petroleum Development Company of Nigeria says the sum of 42 billion US dollars was paid to the federal government as economic contribution to the joint venture partners from 2011 to 2015.

In its sustainability report 2015 released on Monday, the oil giant noted that government also received 4.95 billion dollars in 2015 as production entitlement, taxes, royalties and fees.

Meanwhile, the Bayelsa State government has sealed the Gbaran Ubie Oil and Gas production facility owned by Royal Dutch Shell on court orders.

A statement issued by the Executive Secretary of the state’s Physical Planning and Development Board, Boro Ige-Edaba, said that this is to enable the board to conduct environmental, health, technical integrity and safety checks at the facility.

Shell Asks Ship Owners To Sign Letter Of Comfort

Shell-petroleumShip owners exporting Nigerian oil would have to sign a “Letter of Comfort” (LOC) to guarantee it is not stolen.

This is according to Royal Dutch Shell.

The Nigerian National Petroleum Corporation (NNPC) had in July, banned more than 100 tankers from Nigeria’s waters, citing a directive from President Muhammadu Buhari who wants to trace and recover sums of money allegedly stolen from the oil sector.

In September, the NNPC lifted the ban but asked ship owners to sign a Letter of Comfort to “Guarantee to Indemnify” against any illicit use of their vessel. This led some owners to reject pending bookings.

According to a statement by Shell, the company is putting its reputation on the table that warrants the cargo is not stolen and this should remove any concern ship owners have around bad title down the oil chain.

Traders say oil companies, trading houses and tanker owners were ensuring that actions taken by Nigeria to prevent oil theft did not affect the market

NLNG Eyes $1.5 Bln Debut Ship Yard In Nigeria

Ship_YardThe Nigeria Liquefied Natural Gas Company (NLNG) is sponsoring the construction of the first major ship yard in Nigeria at the cost of $1.5 billion, in its attempt to turn the country into a hub for maritime operations on the continent.

Nigeria does not have a drydock for maintaining and repairing large crude vessels, a major drawback for carriers sailing to the country, NLNG spokesman Tony Okonedo told Reuters.

Only South Africa had such a facility on the continent, Okonedo said, meaning that ships travelled a long distance for repairs. Nigeria has two facilities that can only accommodate small vessels, he said.

Okonedo said Samsung Heavy Industries and Hyundai Heavy Industries have both agreed a $30 million commitment towards the construction of the facility, which would be located in Badagry, near Nigeria’s commercial capital of Lagos.

“It could potentially be used to transport the 2.5 million barrel a day crude business in Nigeria,” Okonedo said on the sidelines of a media briefing.

Okonedo said the NLNG organised a roadshow earlier this year to market the dry dock project to investors, which included multinational oil companies in Nigeria, with large exploration and upstream activities.

He said NLNG, which is owned by Nigeria’s state-oil company NNPC, Royal Dutch Shell, French oil company Total and Italy’s Eni was in discussions with a strategic investor for the project.

It appointed France’s BNP Paribas and Guaranty Trust Bank to help raise around $1.6 billion two years ago to build six new LNG carrier ships, expanding its fleet to 30.

The construction of the dry dock, with a size that can accommodate 185 football fields, will take up to 48 months to complete and would commence once all the funding was in place, he said.

The company, which was set up over two decades ago, has a capacity to produce 22 million metric tonnes of liquefied gas a year. It obtains its gas supply from upstream oil companies and liquefies it for export.

It has long-term supply contracts with buyers in Italy, Spain, Turkey, Portugal and France and also sells on the spot market.

Revenues for the first half shed 25 percent, in line with the fall in crude prices, NLNG said.

Naira Weakens On Tight Dollar Liquidity

naira-notesNigeria’s Naira shed 0.55 per cent against the dollar on Monday after some customers who failed to meet the cut-off time to submit dollar demand to the Central Bank of Nigeria (CBN) sought the greenback from other sources, dealers said.

On Monday, the unit closed at 200.60 Naira to the dollar, weaker than Friday’s close of 199.50 Naira.

The Naira traded at 215 to the dollar at the parallel market, operated by Bureau de Change agents.

The Nigerian currency crashed through a psychologically important level of 200 Naira to the dollar this month in a rout triggered by weak oil prices and escalating tension over the postponement of a presidential election, prompting the CBN to scrap its bi-weekly forex auctions.

Dealers said some customers submitted their orders to the CBN after a 12:00 GMT cut-off time and were not allotted dollars, leaving them to source hard currency from lenders.

Addax sold $6 million on Monday while Royal Dutch Shell sold an undisclosed amount on the interbank, dealers said. Lenders also resold to their customers at a spread.

The CBN scrapped its bi-weekly currency auctions on Wednesday and a market body said it would sell dollars only at 198 Naira, a move that amounts to a de facto devaluation of the currency of Africa’s biggest economy.